If I had a lump sum of £10k to invest today, I’d buy UK shares. I wouldn’t buy just any old stocks, however. I’d focus my attention on high-quality blue-chip stocks to buy and hold for life.
Blue-chip UK shares
There are a handful of UK shares that I’ve been buying this year. With a lump sum of £10k, I’d boost my holdings in these firms.
One of the stocks I’ve been buying in 2020 is Asia-focused insurance company Prudential (LSE: PRU). Over the past 12 months, this corporation has wholly reorganised its operations. It divested its UK arm and agreed on a substantial cash infusion ahead of a potential spin-off of its US business.
As a result of these transactions, Prudential’s operations are now primarily focused on Asia. From an investment perspective, this is incredibly exciting. Many economists believe that Asia’s economic growth is only really just getting started. A booming middle class is driving increasing demand for consumer goods, and products such as life insurance. This is where Prudential can grow. It is one of the most recognised life insurance providers in Asia and has several agreements with leading financial institutions to help distribute its product.
I believe the company’s recognition across Asia, as well as the region’s economic growth tailwinds, will help propel its growth in the years ahead. That’s why I’ve been investing in this firm as part of a basket of UK shares.
Another company that I’m considering adding to my portfolio in the near term is Experian (LSE: EXPN). Like Prudential, this business has a strong competitive advantage. It is one of the world’s largest providers of financial data, which helps other financial organisations analyse the credit profile of consumers.
In some respects, this business is quite defensive. Lenders will always need to know the credit quality of their customers. And there are only a handful of firms that have the depth of information required to provide lenders with all the figures they need. Experian is one of these. As long as the company can maintain this competitive edge, I think that it will continue to produce large returns for investors.
Finally, no list of UK shares to buy today would be complete without including Royal Dutch Shell (LSE: RDSB), in my opinion. Shares in this oil giant have come under pressure in 2020 as the price of oil has collapsed. I think this could be an exciting opportunity.
Even though oil demand is expected to decline this year, the world is still consuming nearly 100m barrels per day. At the same time, the oil group is planning to invest billions in renewable energy, which should help diversify its operations and protect future revenue growth.
And while investors wait for this trend to play out, the stock offers a dividend yield of more than 6%. I think that’s extremely attractive in the current interest rate environment.
Rupert Hargreaves owns shares in Prudential and Royal Dutch Shell. The Motley Fool UK has recommended Experian and Prudential. Views expressed on the companies mentioned in this article are those of the writer and therefore may differ from the official recommendations we make in our subscription services such as Share Advisor, Hidden Winners and Pro. Here at The Motley Fool we believe that considering a diverse range of insights makes us better investors.